P=$4000.00,A=$5300.00,t=5 yearsThe principal P is borrowed and the loan's future value A at time t is given. Determine the loan's simple interest rate r.
Accepted Solution
A:
Answer:The rate of Simple Interest is 6.5 % Step-by-step explanation:Given as : Principal = $ 4000.00 Amount = $ 5300.00 The time period of loan = 5 yearsLet The rate of simple interest = R Now, From Simple Interest method Simple Interest = [tex]\frac{Principal\times Rate\times Time}{100}[/tex] And , Simple Interest = Amount - Principal So , Simple Interest = $ 5300.00 - $ 4000.00 Or, Simple Interest = $ 1300Now, Simple Interest = [tex]\frac{Principal\times Rate\times Time}{100}[/tex] So, $ 1300 = [tex]\frac{ 4000\times Rate\times 5}{100}[/tex] Or, $ 1300 × 100 = $ 4000 × Rate × 5 Or, Rate = [tex]\frac{1300\times 100}{4000\times 5}[/tex]Or, Rate = 6.5 Hence The rate of Simple Interest is 6.5 % Answer